What is External Audit

In today's business environment, fraud is the main cause of organizational failure, which results in reputational damages and can also lead to the closure of the organizations. Forensic accounting with appropriate skills, knowledge, and mindset can perform proactive tasks towards mitigating fraud risk and can raise red flags even before the occurrence of fraudulent transactions or events. With the utilization of fraud triangle theory and forensic accounting theory, this chapter is focused on the preventive and detective role of forensic accounting which will highlight the importance of this function as a permanent feature in any organization. This chapter will also highlight the problems associated with the non-availability of forensic accounting in the current organizational culture and will also provide related recommendations. This chapter can be beneficial to regulators, organizational governance management, and standard-setting bodies towards drafting or amending the laws and regulations and inclusion of forensic accounting as a permanent element for all organizations.